MARKET UPDATE: Hiring demand for Executive Compensation associates is up.
With the market outlook specifically for M&A activity in 2024 looking strong, BigLaw firms are starting the year by staffing up related practices -- especially areas that are chronically hard to fill.
Executive compensation law -- sometimes called, or inclusive of, employee benefits work or ERISA (Employee Retirement Income Security Act) practice -- is often one of the hardest practices for BigLaw firms to staff. The work requires a strong understanding of tax laws related to employee benefits and compensation. In some ways, it is spin-off of corporate tax practice but BigLaw firms with large and active transactional practices usually keep "exec comp" lawyers separate and in their own space. Many young lawyers that find interest in this type of work end up going into a broader tax practice. This can undersupply a busy exec comp practice and thus the chronic demand right now across multiple firms.
Here is what I'm seeing:
1. A promising M&A landscape for 2024 = a demand for more exec comp associates
Goldman Sachs' M&A Outlook for 2024 provides valuable insights into the strong M&A market outlook for the year. The report highlights a climate of optimism regarding mergers and acquisitions, driven by various factors, including economic recovery, industry consolidation, and opportunities for strategic expansion.
This expected demand directly impacts the demand for specialized legal expertise, particularly in executive compensation, ERISA, and the extensive web of tax, securities, and other relevant laws that surround these matters. As organizations engage in intricate M&A transactions, they seek legal counsel to navigate the intricate legal frameworks and compliance issues involved, underscoring the importance of professionals in this field.
2. The demand is increasing across all of the major legal markets
One notable aspect of this trend is its nationwide reach. Major markets known for their robust transactional practices, such as New York City, Boston, Washington, D.C., and the San Francisco Bay Area, are all witnessing an increase in demand for legal associates specializing in executive compensation and ERISA work. These markets are hubs for Fortune 500 companies, tech giants, financial institutions, and startups, all of which drive M&A activity.
In New York City, the global financial center, Wall Street firms are actively involved in M&A deals, necessitating the expertise of executive compensation and ERISA attorneys with a multifaceted skill set. Boston's thriving biotech and pharmaceutical sectors are fueling significant M&A transactions that require comprehensive legal support. The dynamic regulatory environment of Washington, D.C., adds to the complexity of corporate transactions. In the San Francisco Bay Area, the tech industry's anticipated recovery and growth fuels the demand for legal professionals who can adeptly handle executive compensation and ERISA issues within the tech sector while managing intricate tax and securities law matters.
3. The BigLaw firms are looking for certain types of exec comp associates
The increase in demand for executive compensation and ERISA attorneys is not general though; it's about specific skills and experience that are connected to the legal work that is expected to increase in 2024. Here's a closer look at what's in high demand:
experience in company representation and compensation disclosure: Firms are seeking associates who can effectively navigate complex compensation disclosure requirements in transactional documents. This experience is critical in ensuring that companies comply with regulatory standards while designing and implementing compensation plans.
expertise in transactional executive compensation and benefits matters: The ability to handle a wide range of transactional executive compensation and benefits matters is also sought after. This includes advising on tax, securities, and other relevant laws associated with compensation packages, equity-based arrangements, and incentive compensation plans.
M&A expertise, particularly in private equity: Professionals who can seamlessly integrate executive compensation and employee benefits matters into M&A transactions, especially in the private equity sphere, are more in demand. Their expertise is crucial for structuring deals that align with strategic goals while managing the intricate legal aspects.
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In conclusion, the recent increase in demand for legal associates specializing in executive compensation and ERISA work is closely linked to the robust M&A market outlook for 2024. As clients continue to navigate complex M&A transactions in this promising landscape, the need for professionals with specific skills and experience becomes increasingly evident.
If you are an exec comp associate in BigLaw (or even a tax associate open to further specialization as part of your move), you can set up a time to have a career advising appointment with me at calendly.com/gridline.